Presenting to parliament a bill to ratify a loan agreement with the European Bank for Reconstruction and Development (EBRD), Karakaçi said the financing completes the funding package for one of Albania’s biggest railway investments in decades.

The project will finance the electrification of the Tirana-Durrës line and the airport branch, construction of the required power infrastructure and certification in line with European Union standards, paving the way for the country’s first modern electric rail service.

“Civil works have been completed, signalling systems are nearing completion and construction of the new stations is under way,” Karakaçi told lawmakers, adding that electrification will begin once the agreement is ratified.

He said the Tirana-Durrës project forms part of a broader programme to modernise Albania’s rail network, including extending the line to Tirana’s central station, building a modern train maintenance facility and introducing a public service contract for rail operations.

Karakaçi said procurement for the reconstruction of the Vorë-Shkodër-Hani i Hotit railway, a strategic link with Montenegro and the European rail network, is nearing completion. Preparations are also under way to rebuild the Durrës-Rrogozhinë section and design the extension to Pogradec.

He described the proposed Durrës-Prishtina railway as a long-term strategic priority, with efforts focused on securing financing.

“These investments show that Albania is not simply building a railway line, but a modern national network integrated with European transport corridors,” Karakaçi said, adding that the projects would boost economic growth, strengthen Corridor VIII and support greener transport.

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Karakaçi said the 110/20 kV energy project is unique, as it will be constructed underground, ensuring long-term electricity security and a stable power supply for the city.

“With an investment of 22.5 million euros, the project aligns with Tirana’s Green City Action Plan (GCAP) under the EBRD’s Green Cities program,” Karakaçi added.

He noted that ongoing energy sector reforms are producing tangible results, boosting international partners’ confidence in Albania’s public institutions, with this agreement serving as the latest example.

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The agreement, ratified with the votes of the ruling majority, provides for a 40 million euro loan to support the plant’s electromechanical rehabilitation, aimed at improving the safety and efficiency of electricity generation from renewable sources.

The planned works will upgrade equipment technology, increase the reliability of the facility’s operations and extend the plant’s operational lifespan by at least 30 years.

The new financing adds to previous assistance for the project and will fund additional rehabilitation measures identified during technical assessments conducted by international experts.

The rehabilitation project is expected to be implemented by Albanian Power Corporation (KESH), with works scheduled for completion in July 2030.

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The sovereign guarantee agreement was signed by Matteo Patrone, Vice President for Banking at the EBRD, and Enea Karakaçi, Director of Albanian state-owned electricity distribution operator OSHEE in the framework of the OSHEE Sustainability Project.

“We aim to strengthen financial stability by providing green, less costly and more sustainable sources of financing,” Malaj said.

During the meeting, Finance Minister expressed to the EBRD Vice President his appreciation for the continuous support for Albania over the years.

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The Deputy Minister of Infrastructure and Energy Enkelejda Muçaj told lawmakers that the agreement is designed to improve Albania’s energy sector through the structural, operational and financial reform.

The draft law is part of the Albanian government’s commitment to finalize its power sector reform,  overseeing the implementation of the policy reform, according to the completion of the elements (PRE) defined in the energy sector reform roadmap.

The implementation of the Strategic Plan for Reforming the Energy Sector in Albania is intended to be used as a tool to create a clear path for reforming Albania’s entire electricity sector in Albania.

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Presenting to the lawmakers a loan agreement of around 70 million euros with the European Bank for Reconstruction and Development (EBRD) for the power distribution operator (OSHEE), Infrastructure and Energy Minister invited the opposition to back the agreement.

According to the Energy Minister, the EBRD loan will help the country to cope with the situation created by the pandemic and construction of a new power substation in Tirana downtown.

Balluku said the loan repayment period is 5 years.

The Minister also said that the government has approved a 10 billion lek guarantee fund for the power utility for the purchase of electricity and provision of uninterrupted power supply to consumers.

She also said that no increase in the electricity price for the residential and small business consumers will be approved in 2022, as the cost will be covered by the government.

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In attendance at the presentation of the draft law were also; Ilir Bejtja, Deputy Minister of Infrastructure and Energy, Ardian Çela, administrator of OSHEE, deputy of the Socialist Party, Alqi Bllako, as the rapporteur of the Commission.

Deputy Minister Beqja and Administrator Çela, regarding the guarantee agreement intended to be ratified through this draft law, said that, at the center of the draft law is the agreement between the Republic of Albania and the European Bank for Reconstruction and Development (EBRD), on the loan agreement between Electricity Distribution Operator and the European Bank for Reconstruction and Development (EBRD), for the OSHEE project to respond to the COVID-19 pandemic crisis.

The loan worth 70 million euros, guarantees the company the necessary liquidity and economic-financial stability, amidst the pandemic period. //a.i/

The financing will also fund the construction of a modern, underground substation in central Tirana.

The loan agreement was signed by the CEO of OSHEE Adrian Çela and the EBRD First Vice President Jürgen Rigterink.

Minister of Infrastructure and Energy Belinda Balluku, who attended the signing ceremony, said that OSHEE starts an initial cooperation process with EBRD to finance important projects.

CEO of OSHEE Adrian Çela said that the project will support OSHEE’s business following the consequences of Covid-19 and the potential construction of a modern underground substation, the first of its kind in Albania.

“OSHEE will also benefit from a technical assistance package that supports OSHEE’s modernisation ambitions and the implementation of best standards in its operations,” Çela said.

The EBRD loan is complemented by a significant technical assistance package to help OSHEE improve its health and safety protocols, strengthen its anti-corruption governance and develop an inclusive training programme for young professionals. The package will also include a smart grid development roadmap study to explore the digitalisation of the distribution network.

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The Council of Ministers approved in principle the loan agreement between the Republic of Albania, represented by the Ministry of Finance and Economy (borrower), and KfW Frankfurt am Main (KfW), to support energy sector reform – phase I, through a loan worth 100 million euros.

The agreement is expected to be submitted to the Assembly for review.//a.i/